Heineken announces plans to invest US$58.25m in UK pubs

UK – Heineken, the world’s second largest brewer, has announced plans to pour US$58.25 million into the UK’s struggling pubs to fund fund 140 projects and upgrades.

According to the company, its British arm will invest the money into around 500 of the 2,900 pubs owned by its Star Pubs & Bars unit, with the aim of creating 1,000 jobs.

“We believe that our commitment to investment, and understanding of consumer trends, will help our licensees’ businesses to keep growing and ensure that the great British pub remains at the heart of British life for generations to come,” said David Fordem, UK managing director of Heineken.

Like many retailers on the UK high street, pubs have had a difficult start to the year, exacerbating a longer-term trend in which many local pubs have fallen on hard times.

Since January 2012, nearly 2,300 pubs have closed, and UK beer sales in pubs fell by nearly half between 2000 and 2016.

Earlier this month, rating agency Fitch said the pub sector was “highly exposed” to rising labour, food and energy costs.

The UK business secretary Greg Clark described the Dutch brewer’s investment plan as a “vote of confidence” in the UK economy.

“From pop-up breweries to historic watering holes, pubs are at the heart of communities and play a vital role in local economies,” he added.

Heineken’s shares reached a record high in January, and in February the group reported better than expected full-year revenues and profits despite unfavourable currency movements.

In its first-quarter results published in April, the group said total UK beer sales were down “mid-single digit,” but globally had risen by 4.3 per cent.